China talked positively about trade with the US, saying they will step up purchases of US agricultural products. Chinese foreign minister Geng Shuang stated that the US and China are on the same page to reach a deal. He mentioned how a deal will have an importing meaning to world and will be beneficial to trade and peace. He went on to explain how Chinese companies are purchasing tons of agriculture this year.
Thirty-five people were killed and 17 missing after the Typhoon Hagibis hit central and northern Japan over the weekend, making it the worst storm in 60 years.
China is playing big brother to India these days. China is always ready to offer some advice to Prime Minister Modi on how to solve his country’s problems. Back in 2014, Modi launched the “Make in India” initiative, which was supposed to help India turned into a “manufacturing star” in the region. Instead, manufacturing’s contribution to the country’s GDP has been dropping almost every year. In a Global Times editorial published last week, China attributed India’s failure to become a manufacturing star to Modi’s refusal to join BRI. “India’s insistence on not joining the China-proposed Belt and Road Initiative (BRI), which exemplifies how misleading mind-sets have cost India opportunities to become a manufacturing star over the years,” says the editorial. Then there’s Modi’s cozying up to America, which nurtures a sense of complacency among Indians.
China is advising India to join BRI and distance itself from America. That’s exactly what neighboring Pakistan did in recent years. It distanced itself from America while joining BRI at the same time by building the China Pakistan Economic Corridor (CPEC). CPEC is a link between western China and the Indian Ocean, and, therefore, an alternative route to Middle East oil supplies and the riches of Africa. While CPEC helps Pakistan build its infrastructure, it doesn’t seem to have helped Pakistan’s manufacturing. Industrial output’s contribution to GDP dropped from 20.03% in 2014 — when CPEC was launched — to 17.94% in 2017, according to Statista.com This pattern is very similar to that of India.
Meanwhile, CPEC came at a big cost, which keeps on rising with corruption on both ends of the investment equation. As of 2019, the cost of CPEC projects is $62 billion, close to 50% higher from the original cost of $46 billion back in 2014. We all know what that means: Pakistan is getting more indebted to China who has been financing the project. In fact, Pakistan’s external debt took off shortly after CPEC was launched, and it’s one of the factors that drove the country back to the doorsteps of IMF early this year. In short, joining BRI hasn’t solved Pakistan’s manufacturing problem, and it won’t solve India’s manufacturing problem.
The major Asian stock markets had a mixed day today:
The major Asian currency markets had a mixed day today:
Some economic news from last night:
Some economic news from today:
Positive news emerging with a prospective Brexit deal. A German member of the EU Parliament said an agreement with the UK is “now within our grasp.” However, Mr. Barnier, chief negotiator, said that a deal “would be very difficult but possible.” The European Union is considering an emergency summit before the end of the month to push through a Brexit deal. The main issue with the original agreement was the backstop agreement in Ireland. However ,the recent suggestion is that the Irish sea would act as a border which would then remove that obstacle.
Turkish President Recep Tayyip Erdogan plans to start “Operation Peace Spring” which will see the resettlement of one million Syrian refugees in northern Syria. The second step would then be to return the 3.65 million Syrians from Turkey to their hometown. Meanwhile, the US has imposed Turkish sanctions as they demand a Syrian ceasefire, the claim is that Turkish may be responsible for executions of Kurds in Syria.
The Iranian foreign minister said that dealings with the US have finished and that US President Donald Trump has “closed the door” to any negotiations with the US decision to further sanctions on the Iranian Central Bank.
The major Europe stock markets had a mixed day today:
The major Europe currency markets had a green day today:
Some economic news from Europe today:
Today the International Monetary Fund (IMF) downgraded global economic growth for the fiscal year to 3.0%. This is a -0.2% decrease from the forecast given in July. “The weakness in growth is driven by a sharp deterioration in manufacturing activity and global trade, with higher tariffs and prolonged trade policy uncertainty damaging investment and demand for capital goods,” commented Chief International Monetary Fund Economist Gita Gopinath. Gopinath also stated that the US-China tariffs will cause the global economy to shrink by -0.08% by 2020. According to Reuters, the -0.08% decrease is equivalent to $700 billion.
Tuesday night marks the next round of debates for 12 Democratic presidential hopefuls. Former frontrunner Joe Biden is nearly tied with Elizabeth Warren in recent polls. Tonight will be the first debate since Biden’s son Hunter was accused of foul play in Ukraine. On Sunday, Hunter Biden announced he will resign from his position on the board of a Chinese-backed private equity firm. Amy Klobuchar, Beto O’Rourke, Julian Castro, and Tulsi Gabbard are the only candidates who have not yet qualified for November’s debate and likely won’t make it to the next round. Tom Steyer, a self-funded billionaire, will make his debut appearance during tonight’s debate.
Reports are circulating that the United Auto Workers union (UAW) may be close to finalizing a deal with General Motors (GM) after a month-long strike. The strike has already cost America’s top automaker to lose $2 billion after production came to a near halt at 21 different factories. GM has agreed to grant temporary workers full-time employment status after three years of service. Additionally, the company agreed to pay increases although the details are still being negotiated. GM’s stock rose 2.14% today after the announcement.
In an effort to increase tourist spending, Brazil plans to increase the duty-free spending limits in airports from $500 to $1,000 (R$4,000). Brazilians crossing over from bordering Paraguay will also have the ability to spend more with the limit rising from $300 to $500. The legislation will begin in January 2020.
US Market Closings:
Canada Market Closings:
TSX Composite advanced 3.23 points or 0.02% to 16,418.39
TSX 60 advanced 0.80 of a point or 0.08% to 983.45
Brazil Market Closing:
Crude oil was mixed today with WTI trading up slightly and Brent moving down one percentage point. News on the Iranian oil tankers and further sanctions against the central banks are putting middle east tensions up in the region.
The oil markets had a mixed day today:
The above data was collected around 14:40 EST on Tuesday.
Japan -0.20%(+0bp), US 2’s 1.62% (+1bps), US 10’s 1.76%(+2bps), US 30’s 2.22%(+1bps), Bunds -0.46% (-2bp), France -0.27% (+3bp), Italy 1.05% (+3bp), Turkey 15.12% (+75bp), Greece 1.44% (-33bp), Portugal 0.18% (-1bp), Spain 0.24% (+2bp) and UK Gilts 0.70% (+5bp).